Use the Information Below to Answer the Following Question(s)

question 91

Multiple Choice

Use the information below to answer the following question(s) .A dental office is in the process of changing their costing system.Their system currently uses a single direct cost pool (professional labour) and a single indirect cost pool (staff support) .The direct categories in the new, refined costing system include:
1.Professional partner labour.Average total annual compensation of the two partners is $100,000; and, each partner has 2,000 hours of budgeted billable time.2.Dental assistant labour.Average total annual compensation of the four assistants is $22,500 each, and each assistant has 2,000 hours of budgeted billable time.3.Office staff.Average total annual compensation of the two staff members is $15,000 each, and each has 2,000 hours of budgeted billable time.The indirect category in the new refined costing system includes professional liability insurance.The budgeted indirect amount is $200,000, and the allocation base is budgeted professional labour hours.The dentist and dental assistants are considered professional labour hours.
-What is the budgeted direct cost rate for dental assistant labour?

• A)$17.875 per hour
• B)$16.125 per hour
• C)$13.750 per hour
• D)$11.250 per hour
• E)$9.125 per hour

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Definitions:

Collectivism

Collectivism is an ideology that emphasizes the priority of group goals over individual goals and the importance of cohesion within social groups.

Group Goals

Objectives or outcomes that a group collectively seeks to achieve or accomplish.

Individualism

A social theory valuing the independence and self-reliance of the individual often over the group or collective society.

Actor-Observer Bias

A cognitive bias that explains the tendency to attribute one's own actions to external factors while attributing other people's behaviors to their internal characteristics.